Transcript Slide 1

English Legal System
Alternative Dispute Resolution
Introduction to Funding Civil
Litigation
Aims
•
The aims of this lecture are to:
1.
Examine the alternatives to litigating matters
through the courts in civil proceedings;
Analyse the differences between forms of ADR and
in particular arbitration and meditation;
Look at the public funding of civil litigation and
recent reforms which have been made;
Examine other ways of funding litigation other than
public funding;
To look at whether there is need for greater public
funding of litigation.
2.
3.
4.
5.
Learning outcomes
•
By the end of this lecture you should be able to:
1.
2.
3.
State what is meant by alternative dispute resolution;
Describe the differences between arbitration and meditation;
Critically assess the advantages and disadvantages of using
alternative methods of dispute resolution rather than litigating
matters through the courts;
Describe the current arrangements for public funding of civil
litigation in England and Wales;
Describe the alternative funding which is available to litigants
in this country;
Critically consider whether the present arrangements meet
the needs of litigants.
4.
5.
6.
ADR Definition
• ADR involves the settling of legal disputes
without having recourse to the courts, to
traditional adversarial litigation
• It can take a number of forms the most
common of which are arbitration and
mediation
• It has become particular popular in this
country following the success that it had in
the United States
Arbitration
• Governed by the Arbitration Act 1996
• An arbitrator who is impartial, independent of the
parties will hear the case and than impose a decision
on the parties
• This decision can be enforced
• This is the most formal type of ADR and is common
in contractual disputes, construction disputes and
other major commercial agreements
Arbitration
• Why contractual disputes?
Often involve, if a commercial large-scale
organisation a lot of money – delays can cost
a fortune
Also the contract itself will often include an
arbitration clause, partly for the reason stated
above, to avoid wasting money
Mediation
• The mediator works between the parties to promote
settlement, however, any settlement reached is
consensual, and generally non-binding on the parties
• Contract with conciliation
• Very informal system
• Traditionally associated with matrimonial disputes,
but now being used in other more diverse areas of
law such as negligence claims, judicial review etc…
Why found traditionally in
matrimonial law?
• Essentially because of the continuing
nature of the relationship between the
parties if they have children
• Does it always works in those situations
though?
Family Law Act 1996, Part II
Why avoid litigation?
•
The disadvantages of traditional litigation were
summarised by Lord Woolf in his reports:
1.
2.
3.
Too expensive;
Too slow;
Too adversarial.
Civil Procedure Rules aimed at tackling these problems
Litigation is a lottery?
What are the advantages of
ADR?
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These may be summarised as being:
1.
2.
3.
4.
5.
6.
Cheaper;
Faster;
Informal;
Convenient;
Private;
Agreed solutions.
The Courts’ Encouragement
of ADR
• CPR Rule 1.4
• Cowl v Plymouth City Council (2001) – Lord Woolf
• Dunnett v Railtrack (2002)
A change in direction:
• Hurst v Leeming (2002)
• Halsey v Milton Keynes General NHS Trust (2004)
The cost of civil litigation what are costs?
• Basic costs/ profit costs
• Disbursements
The cost of civil litigation
• Funding your own solicitor’s costs
• Paying for your opponent’s
• Supreme Court Taxing Office Survey 19941995:
– In 50% of cases worth less than £12,500 costs of
one side were equal to or greater than claim value
– 1991 Which? Report: 10% of people put off finding
a solicitor by cost
Access to Justice and Costs - the
Government’s stated objective
• “The justice system should serve everyone,
regardless of their means. People should be
able to find effective solutions to their legal
problems. Justice must not be restricted to
the very wealthy, or the very poor, who may
qualify for legal aid. At the same time,
taxpayers deserve value for the money they
contribute to legal aid and the courts” - Lord
Chancellor’s forward to “Modernising Justice”
Government White Paper 1998.
Funding Options
• Private payment
• Before the event insurance
• Pro bono work
• Law centres and CABs
• Trade Unions
• Special Interest groups
Funding Options Civil Legal
Aid 1949 - late 1990s
• Means test
– Disposable income no more than £7595
p.a
– Disposable capital no more than £6750
• Merits test
– Reasonableness
– Legal Merits
Report of Sir Peter Middleton to The
Lord Chancellor (September 1997)
• Rapidly growing costs with lack of
satisfactory mechanisms for controlling
growth
• Inability to target resources on priority
areas
• Poor value for money.
Rapidly growing costs
Fewer people helped
• 1985-1990 number of certificates
increase by 22%. Net expenditure
increased by 145% to £153 million
• 1979 79% eligible
• 1999 48% eligible
Cost of Legal Aid
• The legal aid bill too high for the taxpayer
– costs for all family and civil: £671million 97/98
– costs 93/94 - 96/97  22% . Inflation was 7%
• 90% of the costs are lawyers’ fees
• Numbers being assisted falling
• Civil legal aid was entirely demand, rather
than resource, led
Poor value for money
• No control over which law firms, good or
bad, could obtain legal aid
• Lawyers who ran legal aid cases took
no risk and were tempted to run cases
that had very poor prospects of success
Conclusion reached by this
government
• “Should legal aid also be offered in cases
where other arrangements already exist to
support litigants? I think not.”
– Lord Irvine, the Lord Chancellor
– Almost all personal injury legal aid disappeared in April 2000
• Access to Justice Act 1999 - creating the Legal Services
Commission
• Community Legal Service
Some counter arguments
• Only £55 million spent on legal aid PI cases
95/96
• £518 million recovered in damages
• DSS clawback estimated at £67 million in
95/96
• Can conditional fees replace it?
The Community Legal
Service (CLS)
• LSC: Legal Services Commission (set up by the
Access to Justice Act 1999)
• LSC is a publicly funded body managed
independently which exercises its functions in relation
to funding for civil disputes through the CLS
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•
•
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A controlled budget
Planning
Contracting
A new funding assessment
Contracting
• S.6(3)(a) Access to Justice Act 1999 gave the LSC
the power to enter into contracts with bodies or
persons for the provision of services
• s.4 (8) gave the LSC, or others it authorises to do
so, power to accredit bodies to provide services
• and the power to monitor the services provided
and withdraw accreditation if the services are of
unsatisfactory quality
Legal Aid Franchise Quality Assurance
Standard (LAFQAS) Now known as
Quality Mark
• To obtain a contract a provider must have this
• The CLS monitors management of the provider in
general and of individual cases
• “Contracting will help to ensure the quality of service
consumers receive; only those lawyers who meet
prescribed quality standards will be able to obtain
contracts, and their performance will be monitored”
(White Paper, Modernising Justice para 3.18).
Priorities
• Social welfare cases
• Other cases of fundamental importance to
the people affected
• Cases involving a wider public interest
Cases generally excluded from
funding Sched. 2 AJA 1999
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Negligently caused injury
Conveyancing, boundary disputes
Making of wills
Trust law
Defamation
Matters arising out of the carrying on of
a business
Criticism of the new system
• Fall in number of solicitors doing this
work survey of 150 firms by the Law
Society Gazette:
– 57% already given up legal aid contracts
– 11% ceasing housing work
• Recently qualified solicitors turn their
backs on work?
Summary of lecture
•
You should now be able to:
1.
Describe the different forms of alternative dispute
resolution and in particular arbitration and
meditation;
State what options are available for the funding of
civil litigation;
Describe the system of public funding and the
reforms which have made to it;
Critically consider whether those reforms have
been successful in meeting the needs of litigants in
civil cases.
2.
3.
4.
Further reading
• Slapper, G. and Kelly, D., The English Legal
System (London: Cavendish Press, 2004, 7th
edition), chapter 12 generally